Notices to Mahindra Satyam on money laundering

The adjudicating authority under the Prevention of Money Laundering Act (PMLA) issued notices to Satyam Computer Services Limited, or SCSL (now Mahindra Satyam), to present its case in the recent attachment of the company’s fixed deposits. On October 18, the Enforcement Directorate (ED) had attached SCSL’s fixed deposits worth Rs 822 crore on charges of money laundering.

“On October 30, the authority had issued notices directing the company to appear before it in the case,” said a senior ED official. adding the Mahindra Satyam management was asked to appear before the adjudicating authority on December 10.

“Since this amount subsists with SCSL and constitutes a part of the loans derived or obtained by pledging inflated SCSL shares, these fall within the mischief of proceeds of crime under the PMLA and are liable for attachment,” the Enforcement Directorate had stated after attaching the accounts.

The attachment is a provisional one and has to be confirmed by the adjudicating authority within 150 days. While deciding on the complaint of the Enforcement Directorate, the authority gives an opportunity to the party concerned to present its case.

“The company has to approach the authority to present its point of view; there is no such thing as appealing against the Enforcement Directorate’s action,” the official said.

Vineet Nayyar, chairman of Mahindra Satyam, had earlier said the company would challenge the Enforcement Directorate’s action, as the money in question was spent by the earlier management of SCSL, headed by B Ramalinga Raju.

Before attaching the company’s fixed deposits in the four banks, the Enforcement Directorate had carried out multiple rounds of provisional attachments of the properties of Raju and his associates.